July 7
Big Congrats and shout-outs to 3 of my Keller Williams Realty – Atlanta Metro East agents who were in the Top 25 in our market! Rock on June Hyde, Ken Harper and Judith O’Rear! So proud of all you’ve accomplished in the month of June!!!
Kristy Stubbs-Henderson
WHAT ARE THE BENEFITS OF HOMEOWNERSHIP?
Homeownership brings many benefits. When you buy your first home, you’ll become part of a community and experience the security of owning the roof over your head. Get more information about these potential benefits and others in My FirstHomeSM, an online learning experience that’s helping first-time buyers like you.
As a homeowner, you may also be able to:
Take control: Avoid rent increases and cancelled leases while creating a home that meets your needs and tastes.
Build home equity: Grow your assets with the principal portion of your mortgage payments as your property value increases.
Get tax benefits: Deduct mortgage interest and real estate property taxes on your income tax returns. (Consult a tax advisor regarding the deductibility of interest.)
Build your credit: Create a strong credit history by making on-time mortgage payments.
Are you thinking about buying your first home? Complete and submit the comment form below and/or contact Judith O’Rear at 678-731-8223.
By Richard Davies
While the housing recovery is real there is still plenty of pain for homeowners who have been underwater with their mortgages since the collapse of the market six years ago. A new report out today says 10.7 million US households owe at least 25 percent more on their mortgages than their properties are worth. But Darren Blomquist, vice president at the listings firm RealtyTrac, says the findings also show that the recent rise in home prices in most markets is helping many homeowners improve their equity stake. “Steadily rising home prices are lifting all boats in this housing market and should spill over into more inventory of homes for sale in the coming months.”
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Rising Home Prices, Increasing Equity Spark Move-up Sales.
By Maria Patterson RISMEDIA
This week’s breaking news regarding the significant jump in April home prices – posting record monthly growth and the fastest year-over-year growth in seven years – is just the latest in a series of statistics confirming that the real estate market is primed for the return of home sellers, who are now financially able and emotionally confident to list their current home in order to move up to their next.
The April home-price increase data from S&P/Case-Shiller comes on the tail of a report from CoreLogic earlier this month heralding the return of positive equity for 850,000 more residential properties in the first quarter of 2013, another sign that move-up buyers will become an increasingly prevalent market segment in the months ahead. According to CoreLogic, the national aggregate value of negative equity decreased more than $50 billion to $580 billion at the end of the first quarter from 631 billion at the end of the fourth quarter of 2012.
“In 2012, 1.7 million homeowners who were previously underwater achieved positive equity and about half that number achieved positive equity in the first quarter of 2013. For every home price increase of 5 percent another 1.2 million will reach positive equity. It appears to be a widespread phenomenon and one that will benefit this inventory-starved market.”
According to Lennox Scott, home prices in the Northwestern U.S. reached bottom around November 2011. “At that time, a surge of local homebuyers regained buyer confidence to move forward with home purchases,” explains Scott, chairman and CEO of Washington state-based John L. Scott Real Estate. “Prices have seen double digit gains for homeowners in 2012/2013, thus bringing underwater homeowners into positive equity. However, there is still a ways to go before the majority of underwater owners see some relief.”
According to the CoreLogic report, the decrease in negative equity is driven in large part by an improvement in home prices. Tuesday’s S&P/Case-Shiller data reports home-price gains in 19 of 20 cities, with the 20-city composite index rising 2.5 percent in April, the largest monthly growth on record (data dates back to 2000). After seasonal adjustments, prices rose 1.7 percent in April. Compared with the same period in the prior year, prices in April rose 12.1 percent, the fastest annual pace since 2006.
While low interest rates have been fueling homebuyer demand and thereby, home prices, rates have been trending slightly higher in recent weeks. Some believe that higher rates could curb demand among some buyers, but most industry experts agree that increasing rates will serve to push many more buyers into action. As homebuyers continue to flood the market, fueling home values and homeowner equity, top brokers set their sights on the return of the move-up buyer.
“Recently, with the sudden rise in interest rates, up one half point, we have seen a mini power surge of sales activity,” reports Scott. “This is usually the case with sudden rate increases, however this time, we also saw an increased number of sellers bringing their homes on the market, so as to also be in a position to take advantage of rates before they continue to rise. The current market conditions are creating a high velocity of sales activity, keeping the inventory of homes for sale low. With the return of positive equity, previously underwater homeowners can now sell their home if the timing is right for them.”
The pricing increases have been caused by many factors including an improved economy, decreases in refinancing at over-inflated prices, pent-up demand, lack of inventory and low interest rates.”
Casey reports that most move-up buyers in her markets are actually buying before they sell their existing home in order to take advantage of low rates. In order to facilitate this trend, Howard Hanna introduced the “Buy Before You Sell” program. As Casey states, “We are so sure of the increased equity that we are advancing the equity so they can move ahead. This should also begin to add more available homes to the market. Unfortunately, with so few homes available, move-up buyers are struggling to find the home of their dreams. We are also beginning to see an increase in new construction specs. This always helps push the market. “
While the evidence that the increase in positive equity is sparking homeowners to list their homes and move-up is still anecdotal to some degree, brokers believe this trend could soon ease the current housing inventory shortage in most markets.
“There probably aren’t any statistics to show how many people gained positive equity and then listed their home to purchase another one,” says Liniger. “But we may be starting to see an impact on the low inventory situation. Inventories have been dropping for several months, but now we’re starting to see those drops becoming smaller and smaller. It’s very likely that we’ll soon see the inventories turn around and start rising.”
Taking advantage of the impending growth in the move-up buyer segment will require real estate brokers and agents to review and adjust their current business strategies.
Many homeowners have been afraid to enter the market, but they might not understand that if they wait, interest rates will rise and the price of their next home will be higher too. At the same time, smart agents understand that they are a valuable source of information and can provide critical impetus to uninformed homeowners.”
“All of our marketing is keyed into the message, ‘homes are selling and prices are going up’,” says Casey. “We are sharing data with our associates and clients who are the best media source of all. We have to assure they have the right message to share.”
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by VINCENT KING
You look out the window of your home each night after dinner, staring across the street at your neighbors. You long for their fancy cars, their manicured lawns, and even the vacations they seem to take several times a year.
You’re not alone.
I often look out my window, too — staring at the gorgeous homes and cars — wondering how they manage to pay for them. After all, we live in the same neighborhood, our kids go to the same schools, and their salaries aren’t that much more than ours.
There are several reasons that our neighbors can afford so many of the things we would love to have, but could never fathom splurging on:
1. Perception Is Everything
Your perception may be skewed. You see fancy cars in the driveway, and you can almost feel the trim lawns under your toes. You watch work crews constantly going in and out as they work on awesome remodeling projects inside. Yet, none of this means that your neighbors are wealthier than you are.
Just because YOU see them as more affluent doesn’t mean they ARE.
You’re only able to see the surface of their spending; you have no idea what’s happening underneath.
2. Allocation Is Essential
While you choose to consistently save money for your kids’ education, and for your retirement, they could be spending these “excess funds” on their cars and homes. They might be making the shallow choice to spend their money on what people can see, while you’re spending your money on the life you want to live, both today and tomorrow. You’ve chosen to pay for peace of mind.
It’s how your neighbors allocate their income that makes them seem richer than they are.
3. Perks Matter
While your neighbors’ salaries might be slightly higher than yours, it likely isn’t enough to justify their massive leap in spending. Fringe benefits, however, can greatly widen the gap. They could be receiving perks like cars, phones, or laptops; these can give the recipient an amazing leg up when it comes to freeing money for other pleasures.
4. Luxuries of the Mature
As families mature, houses get paid off and savings grow. Even if your children attend the same school, their children are older, and the adults have a few years on you, as well. They very well could have spent those few extra years making payments on their house and putting money in the bank — giving them a huge advantage. Just imagine how much more financial freedom you would have if you didn’t have to manage your monthly mortgage.
5. Their Lives Might Be Plastic
Your neighbors might worship the power of the plastic. While you’re smart enough to understand the headaches of undisciplined credit, your neighbors might be living carelessly — buying short-term luxury today in exchange for a meager tomorrow.
6. They Know Where to Find Deals
I consider myself a connoisseur when it comes to finding great deals on groceries and kids clothing. Perhaps your neighbors also know something about finding deals on the things they need, which frees up more money for things they want.
7. They Pay for Their Immediate Wants First
Your neighbors could also have more money than you do because they prioritize differently, and pay for projects and luxuries from their savings.
While my neighbors may or may not make more money than me, I don’t let it influence the way that I live.
I spend money in the way that’s most important for my family and me — both for a better, more comfortable today, and for a brighter tomorrow.
As “The Millionaire Next Door” and “Rich Dad, Poor Dad” point out, those that use their money for homes, cars, and clothes are spending on material items and living on “rented” lifestyles. Instead of building assets, these people are living on liabilities, and that can be a dangerous mindset.
You don’t have to live like a king today if it means you’re going to live like a pauper tomorrow.
It doesn’t matter what the Jones’ are doing. Not now, or ever. Save where you can, spend where you need, and live a life you want.
Have you ever struggled to keep up with the Jones’? How did you manage?
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What Your Home Insurance Covers… And What It Doesn’t
By Glen Curry
Whenever you purchase a new home with financing, the mortgage company will absolutely require that you also purchase home insurance. Many homeowners view their home insurance as a “necessary evil”, and simply purchase their policy without knowing exactly what it covers.
Lenders want to know you’re protecting their investment from harm, such as damage caused by fire, water, a tree falling through the roof, and even vandalism. Don’t wait until something happens and you need to USE your policy to find out.
Unless you’ve added some extra coverage – or “upgrades” – to your policy, here’s a good rule of thumb on what a typical home insurance policy covers:
1. What It Covers
A typical policy will pay for damage to your property and your possessions in the event of certain storms, fire, theft or vandalism. Like renter’s insurance, it also provides liability coverage if someone gets hurt on your property and decides to sue. Homeowner’s insurance also covers shelter costs, so you don’t have to face crazy hotel bills if you’re temporarily displaced from your house.
Homeowner’s insurance can protect belongings outside the home, too. If something is stolen from your car, auto insurance won’t cover it—but your homeowners policy likely will. Most policies will cover your belongings when they are traveling with you. So if you have a $1,200 laptop and it gets lost by the airline, call your insurance agent—right after you file the claim with the airline, of course.
2. What It Doesn’t Cover
A standard policy has exclusions, including earth movements (landslides, earthquakes, sinkholes), power failure, war, nuclear hazard, government action, faulty zoning, bad repair or workmanship, defective maintenance and flooding. Windstorms are typically covered, including tornadoes, although insurance companies exclude tornadoes or hurricanes in some high-risk areas.
Water damage is tricky. As a rule of thumb, water from above (rainwater or a burst pipe in an upstairs apartment) is usually covered, but water from below (backed-up sewers or ground flooding) generally isn’t. If your region is prone to floods and earthquakes, you should consider supplemental coverage.
Your Policy’s Coverage
Be sure to check in with your insurance provider to see what your policy covers. If you have any questions, feel free to comment below or call me at 678.731.8223
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Media Contact: Walter Molony
WASHINGTON (August 21, 2013) – Existing-home sales rose strongly in July, with the median price maintaining double-digit year-over-year increases, according to the National Association of Realtors®.
Total existing-home sales1, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 6.5 percent to a seasonally adjusted annual rate of 5.39 million in July from a downwardly revised 5.06 million in June, and are 17.2 percent above the 4.60 million-unit pace in July 2012; sales have remained above year-ago levels for 25 months.
Lawrence Yun, NAR chief economist, said changes in affordability are impacting the market. “Mortgage interest rates are at the highest level in two years, pushing some buyers off the sidelines,” he said. “The initial rise in interest rates provided strong incentive for closing deals. However, further rate increases will diminish the pool of eligible buyers.”
Despite higher mortgage interest rates, Yun identified compensating factors that can sustain a continued recovery. “Although housing affordability conditions will become less attractive, jobs are being added to the economy, and mortgage underwriting standards should normalize over time from current stringent conditions as default rates fall.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.37 percent in July from 4.07 percent in June, and is the highest since July 2011 when it was 4.55 percent; the rate was 3.55 percent in July 2012.
Total housing inventory at the end of July rose 5.6 percent to 2.28 million existing homes available for sale, which represents a 5.1-month supply2 at the current sales pace, unchanged from June. Listed inventory is 5.0 percent below a year ago, when there was a 6.3-month supply. “Tight inventory in many areas means above-normal price growth for the foreseeable future,” Yun said.
The national median existing-home price3 for all housing types was $213,500 in July, which is 13.7 percent above July 2012. This marks 17 consecutive months of year-over-year price increases, which last occurred from January 2005 to May 2006.
The median price has risen at double-digit rates for the past eight months, and is now 7.3 percent below the all-time record of $230,400 in July 2006. Two years ago, the median price was 25.7 percent below the peak.
Distressed homes4 – foreclosures and short sales – accounted for 15 percent of July sales, the same as in June and matching the lowest share since monthly tracking began in October 2008; they were 24 percent in July 2012. Continuing declines in the share of distressed sales account for some of the price gain.
Nine percent of July sales were foreclosures, and 6 percent were short sales. Foreclosures sold for an average discount of 16 percent below market value in July, while short sales were discounted 12 percent.
The median time on market for all homes was 42 days in July, up from 37 days in June, but is 39 percent faster than the 69 days on market in July 2012. Short sales were on the market for a median of 72 days, while foreclosures typically sold in 50 days and non-distressed homes took 40 days. Forty-five percent of homes sold in July were on the market for less than a month.
Data from realtor.com,5 NAR’s listing site, shows the tightest inventory conditions, reported as median age of inventory, are in Oakland, Calif., 20 days; Denver, 31 days; and the Seattle area, 36 days.
First-time buyers accounted for 29 percent of purchases in July, unchanged from June, but are down from 34 percent in July 2012.
All-cash sales comprised 31 percent of transactions in July, the same as in June; they were 27 percent in July 2012. Individual investors, who account for many cash sales, purchased 16 percent of homes in July, down from 17 percent in June; they reached a cyclical peak of 22 percent in February of this year.
NAR President Gary Thomas, broker-owner of Evergreen Realty in Villa Park, Calif., said more repeat buyers are using cash. “The overall percentage of cash purchases has been fairly steady, as has the share of first-time buyers, but the investor share has been trending down since February. This means more repeat buyers are using cash in this tight-credit environment,” he said. “With a steady decline in lower priced inventory, particularly in foreclosures, investors are finding fewer bargains to buy.”
Single-family home sales rose 6.3 percent to a seasonally adjusted annual rate of 4.76 million in July from 4.48 million in June, and are 16.4 percent higher than the 4.09 million-unit level in July 2012. The median existing single-family home price was $214,000 in July, up 13.5 percent from a year ago.
Existing condominium and co-op sales increased 8.6 percent to an annual rate of 630,000 units in July from 580,000 in June, and are 23.5 percent above the 510,000-unit pace a year ago. The median existing condo price was $209,600 in July, which is 15.5 percent higher than July 2012.
Regionally, existing-home sales in the Northeast surged 12.7 percent to an annual rate of 710,000 in July and are 20.3 percent above July 2012. The median price in the Northeast was $271,200, up 6.7 percent from a year ago.
Existing-home sales in the Midwest rose 5.8 percent in July to a pace of 1.28 million, and are 20.8 percent higher than a year ago. The median price in the Midwest was $168,300, which is 9.5 percent above July 2012.
In the South, existing-home sales increased 5.0 percent to an annual level of 2.11 million in July and are 16.6 percent above July 2012. The median price in the South was $183,400, up 13.6 percent from a year ago.
Existing-home sales in the West rose 6.6 percent to a pace of 1.29 million in July and are 13.2 percent higher than a year ago. The median price in the West, driven the most by a supply imbalance, was $287,500, which is 19.2 percent above July 2012.
U.S. home prices continue surge in May
July 30, 2013 at 1:53 PM by AHN
Nathan Andrada – Fourth Estate Cooperative Contributor
Washington, DC, United States (4E) – U.S. home prices rose in May to its highest mark in more than seven years amid signs that the recovery in the country’s residential real estate is gaining traction.
In the 12 months through May, home prices in 10 major cities in the U.S. surged 11.8 percent, according to the home price index of S&P/Case-Shiller. In the broader measure of 20 cities, home values climbed 12.2 percent from a year earlier, compared with economists’ forecast of 12.4 percent gain.
The S&P/Case-Shiller index is calculated using the average of three-month data, which means transactions in March and April influence the result in May. The report also showed the year-to-year increase in April remained unrevised.
Home prices have been boosted by record-low borrowing costs, tight supply and improving labor market. Another reason cited for the rise in home values is expanding household finances, which may drive up consumer spending, the largest contributor in U.S. economy.
The 10-city index climbed 2.5 percent on a seasonally unadjusted basis in May from the previous month, while the 20-city index jumped 2.4 percent using the same comparison.
Each city being tracked in the index recorded an increase in price year-over-year, led by San Francisco’s 24.5 percent increase and Las Vegas’ 23.3 percent gain. New York’s 3.3 percent was the smallest increase in May.
In May, property prices in Dallas and Denver reached record levels, marking the first time a city had topped its prerecession peak, according to the report.
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For a free market analysis of your home contact Judith at 678-731-8223 or email Judith at Judith.orear@metrobrokers.com
By Dan Hinson
In today’s foreclosure-heavy market, it’s not uncommon to find land properties for sale in your area. Land has always been a great investment, due to its limited supply and historic rise in value. In fact, banks are now putting land on the market at prices that are pennies on the dollar compared with the original cost.
Many investors are purchasing land across Georgia. Depending on what you plan to do with the land, there are two different courses of action you can take:
Improving the Land
There are many types of land that you can purchase, some of which has been improved and some not. In Georgia, we have a lot of “pipe farms” available, which are pieces of land that have been stopped midway in the process of creating a community. Roads and sewer may have been installed. If you are investor, this may be good or bad. When you purchase a partially developed piece of land, you are most likely committing yourself to finishing the project, which can add more cost and more risk.
Unimproved land, or land in its natural state, can be purchased specifically to be improved and then sold. Improvement usually consists of building some type of structure on the land, whether it is residential or commercial. Building a structure on the land can significantly raise the value, however, like development of a subdivision, can be costly and add risk.
In today’s market, purchase money financing and/or institutional funding is less available to investors, so cash deals are more frequent. Improvements are financed, in great part, based on the strength of a business plan that ties generation of income to the improvement. The investor might consider an improvement to be a good investment, but the lender may not see the tangible means necessary for repayment.
Unimproved Land
Historically, raw or unimproved land values have risen, but like the rest of the real estate market today, buyers can often purchase land at lower than perceived market value. Many investors choose to purchase and hold unimproved land speculating that value and demand will increase within a reasonable timeframe. This strategy doesn’t involve building costs and maintenance is sometimes less expensive. Additionally, ROI from real estate investments has historically exceeded other investment opportunities. This rationale is widely held by speculative real estate investors today.
Land prices can be dirt cheap (pun intended) in rural areas, but growth can be slow depending upon the intended use of the land. The price of land may be higher in more populated areas, but the potential for return greater. Commercial and residential land values vary with location and use. There is no specific investment rule-of-thumb.
Current land investment opportunities are numerous and vary often providing the buyer with the upper hand. If you have any questions or comments about buying or selling land, be sure to post your thoughts below.
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By Brenda Waters
I’m sure you’ve been asked, “do you have to go to work tomorrow?” My answer to this mundane question is, “no, I get to go to work tomorrow!”
I must confess that I’ve never been one of those people that leap out of bed in the mornings. I hit the snooze button way too many times before I’m in the frame of mind to embrace another day. But the minute my feet hit the floor, I start thinking of all the things to be accomplished. Things that I have to do and things that I want to do.
Rarely at the end of the day have I accomplished everything, but I don’t beat myself up over it. Somewhere in my life’s journey I came to the realization that success comes one step at a time. I also discovered that success is a state of mind and that my success depends on my state of mind.
“Successful men and women become successful because they acquire the habit of thinking in terms of success. Get the success habit in the small circumstances you control, and soon you’ll be controlling the bigger ones.” – Napoleon Hill (“Think and Grow Rich”).
As a real estate salesperson, I met each potential client with butterflies in my stomach. A feeling similar to that of performers right before the opening curtains reveal you to your audience or you are announced as the next speaker. I began visualizing meeting clients, working through the sales transaction from beginning to end, and sitting at the closing table in a win-win finale. Success became a state of mind.
But how do we cope if the ending is not a happy ending… not a success?
“All my successes have been built on my failures.” – Benjamin Disraeli.
Nobody likes to fail, and why should you? Focus on getting better and not on the mistakes or failures. Understanding mistakes is important, but your focus and attention should go into getting better. Success orientation (thinking about success) is associated with more success whereas failure orientation (focusing on mistakes) is not. Studies show that people who believe in repair feel much better and are able to attend to negative feelings much less than people who do not.
Also, studies show that keeping your eye on the long-term goal constantly can distract you from your performance because it creates such distance from your goal. Instead, focus on the short-term sub-goals, especially after “failure.” Remember, success is one step at a time.
“A winner is one who accepts his failures and mistakes, picks up the pieces, and continues striving to reach his goals.” – Dexter Yager.
To be truly successful, you must become conscious of your thoughts and recognize the power of your mind to create your success.
Rather than reacting to an endless barrage of random thoughts, begin to quiet your mind and focus on the thoughts that instill in you a sense of positivity and vision for success. Do this often and I guarantee you will be amazed with the results.
Anything you can conceive and believe, you can achieve!
What recent success can you attribute to your belief in yourself? A vision of your success? A state of mind?
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